SWOT Analysis / TOWS Matrix for Beibu Gulf Tourism (China)
Based on various researches at Oak Spring University , Beibu Gulf Tourism is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, wage bills are increasing, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs,
customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Beibu Gulf Tourism
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Beibu Gulf Tourism can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Beibu Gulf Tourism, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Beibu Gulf Tourism operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Beibu Gulf Tourism can be done for the following purposes –
1. Strategic planning of Beibu Gulf Tourism
2. Improving business portfolio management of Beibu Gulf Tourism
3. Assessing feasibility of the new initiative in China
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Beibu Gulf Tourism
Strengths of Beibu Gulf Tourism | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Beibu Gulf Tourism are -
Cross disciplinary teams
– Horizontal connected teams at the Beibu Gulf Tourism are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
High brand equity
– Beibu Gulf Tourism has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Beibu Gulf Tourism to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Beibu Gulf Tourism has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Beibu Gulf Tourism staying ahead in the Water Transportation industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Beibu Gulf Tourism in the Transportation sector have low bargaining power. Beibu Gulf Tourism has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Beibu Gulf Tourism to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Beibu Gulf Tourism has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Water Transportation industry. Secondly the value chain collaborators of Beibu Gulf Tourism have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Beibu Gulf Tourism
– The covid-19 pandemic has put organizational resilience at the centre of everthing Beibu Gulf Tourism does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Beibu Gulf Tourism is present in almost all the verticals within the Water Transportation industry. This has provided Beibu Gulf Tourism a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Operational resilience
– The operational resilience strategy of Beibu Gulf Tourism comprises – understanding the underlying the factors in the Water Transportation industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High switching costs
– The high switching costs that Beibu Gulf Tourism has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Superior customer experience
– The customer experience strategy of Beibu Gulf Tourism in Water Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management in the Water Transportation industry
– Beibu Gulf Tourism is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Water Transportation
– Beibu Gulf Tourism is one of the leading players in the Water Transportation industry in China. Over the years it has not only transformed the business landscape in the Water Transportation industry in China but also across the existing markets. The ability to lead change has enabled Beibu Gulf Tourism in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses of Beibu Gulf Tourism | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Beibu Gulf Tourism are -
High dependence on Beibu Gulf Tourism ‘s star products
– The top 2 products and services of Beibu Gulf Tourism still accounts for major business revenue. This dependence on star products in Water Transportation industry has resulted into insufficient focus on developing new products, even though Beibu Gulf Tourism has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Beibu Gulf Tourism has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Increasing silos among functional specialists
– The organizational structure of Beibu Gulf Tourism is dominated by functional specialists. It is not different from other players in the Water Transportation industry, but Beibu Gulf Tourism needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Beibu Gulf Tourism to focus more on services in the Water Transportation industry rather than just following the product oriented approach.
Lack of clear differentiation of Beibu Gulf Tourism products
– To increase the profitability and margins on the products, Beibu Gulf Tourism needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Beibu Gulf Tourism has some of the most successful models in the Water Transportation industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Beibu Gulf Tourism should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Beibu Gulf Tourism has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Water Transportation industry over the last five years. Beibu Gulf Tourism even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Employees’ less understanding of Beibu Gulf Tourism strategy
– From the outside it seems that the employees of Beibu Gulf Tourism don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Beibu Gulf Tourism is slow explore the new channels of communication. These new channels of communication can help Beibu Gulf Tourism to provide better information regarding Water Transportation products and services. It can also build an online community to further reach out to potential customers.
High operating costs
– Compare to the competitors, Beibu Gulf Tourism has high operating costs in the Water Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Beibu Gulf Tourism lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Beibu Gulf Tourism has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Water Transportation industry using digital technology.
High bargaining power of channel partners in Water Transportation industry
– because of the regulatory requirements in China, Beibu Gulf Tourism is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Water Transportation industry.
Beibu Gulf Tourism Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Beibu Gulf Tourism are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Beibu Gulf Tourism can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Beibu Gulf Tourism in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Water Transportation industry, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Beibu Gulf Tourism has opened avenues for new revenue streams for the organization in Water Transportation industry. This can help Beibu Gulf Tourism to build a more holistic ecosystem for Beibu Gulf Tourism products in the Water Transportation industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Water Transportation industry, but it has also influenced the consumer preferences. Beibu Gulf Tourism can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Beibu Gulf Tourism can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Developing new processes and practices
– Beibu Gulf Tourism can develop new processes and procedures in Water Transportation industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Using analytics as competitive advantage
– Beibu Gulf Tourism has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Water Transportation sector. This continuous investment in analytics has enabled Beibu Gulf Tourism to build a competitive advantage using analytics. The analytics driven competitive advantage can help Beibu Gulf Tourism to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Beibu Gulf Tourism can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help Beibu Gulf Tourism to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Beibu Gulf Tourism can use the latest technology developments to improve its manufacturing and designing process in Water Transportation sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Building a culture of innovation
– managers at Beibu Gulf Tourism can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Water Transportation industry.
Better consumer reach
– The expansion of the 5G network will help Beibu Gulf Tourism to increase its market reach. Beibu Gulf Tourism will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Use of Bitcoin and other crypto currencies for transactions in Water Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Beibu Gulf Tourism in the Water Transportation industry. Now Beibu Gulf Tourism can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Beibu Gulf Tourism can use these opportunities to build new business models that can help the communities that Beibu Gulf Tourism operates in. Secondly it can use opportunities from government spending in Water Transportation sector.
Threats Beibu Gulf Tourism External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Beibu Gulf Tourism are -
Consumer confidence and its impact on Beibu Gulf Tourism demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Water Transportation industry and other sectors.
Increasing wage structure of Beibu Gulf Tourism
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Beibu Gulf Tourism.
Easy access to finance
– Easy access to finance in Water Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Beibu Gulf Tourism can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Beibu Gulf Tourism needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Water Transportation industry regulations.
Environmental challenges
– Beibu Gulf Tourism needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Beibu Gulf Tourism can take advantage of this fund but it will also bring new competitors in the Water Transportation industry.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Beibu Gulf Tourism.
Shortening product life cycle
– it is one of the major threat that Beibu Gulf Tourism is facing in Water Transportation sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Water Transportation industry are lowering. It can presents Beibu Gulf Tourism with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Water Transportation sector.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Beibu Gulf Tourism in the Water Transportation sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Beibu Gulf Tourism may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Water Transportation sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Beibu Gulf Tourism in Water Transportation industry. The Water Transportation industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Beibu Gulf Tourism will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Weighted SWOT Analysis of Beibu Gulf Tourism Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Beibu Gulf Tourism needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Beibu Gulf Tourism is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Beibu Gulf Tourism is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Beibu Gulf Tourism to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Beibu Gulf Tourism needs to make to build a sustainable competitive advantage.